Southwest Airlines 1995 Annual Report Download - page 10

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10
SECRET NUMBER 3
Keep fares low, costs lower.
Southwest Airlines believes in low fares by philosophy. The
only way to keep our fares low is to keep our costs even lower.
It’s our primary goal. And you can take that to the bank!
“Southwest is THE Low Fare Airline because we are THE Low
Cost Airline. You can’t have one without the other.”
John G. Denison
Executive Vice
President-
Corporate Services
Since our inaugural flight almost 25 years ago, Southwest has provided low
fares to our Customers. After all, low fares are what the shorthaul traveler wants
most from safe air transportation. Low fares are an integral part of our strategy,
and Southwest is THE Low Fare Airline every day, everywhere we fly. To offer
low fares profitably, we must keep our costs even lower—and we do! Southwest
is also THE Low Cost Airline, with the lowest cost structure in the domestic
airline industry.
The key to maintaining our low costs is our high productivity. Southwest
continually achieves the highest asset utilization and Employee productivity of
any U.S. airline. We schedule our aircraft to minimize the amount of time the
aircraft is at the gate, approximately 20 minutes, thereby allowing each
Southwest Employee to consistently handle an average of approximately 2,500
Customers per year. Even though we pay our Employees at or above industry
levels, we achieve competitive unit labor costs due to their high productivity.
As a consequence of our quick turns, we require fewer aircraft and aircraft
facilities than would otherwise be necessary. Additionally, our commitment to
one aircraft type significantly simplifies our operation, which improves our overall
productivity and lowers our costs.